<![CDATA[As one of the major contributors of the GDP, textile industry in Indonesia contributes significantly to the economy. Import surge of yarn, the upstream product of textile industry, from 2016 to 2019 endangered the local industry and pushed government to impose safeguard in 2019-2022, which was then extended to 2026. This research aims to analyze whether safeguard is the most suitable policy to address the issue. Prior researches are mostly focused on import volume and product competitiveness. However, since one of the grand goals of safeguard is to create a space for industries to do structural adjustments, it is crucial to also evaluate industry performance. This research will evaluate those two aspects while also evaluating industry performance. Time series analysis with Error Correction Model is utilized to conduct the research. This research finds that safeguard decreases import volume in the long-run, but not in the short-run; decreases product competitiveness both in the long-run and the short-run; and increases industry performance in the long run, but not in the short run. Although it does not increase global product competitiveness, safeguard is still proven suitable as a trade remedy since it succeeds to smooth out import surge and increase industry performance, signaling for recovery from the injury. However, the industry still has to put extra effort to enhance its product competitiveness to compete in the global market. Besides, government incentive will give further support to form a resilient industry. Keywords: safeguard, yarn, import surge, industry competitiveness, revealed comparative advantage.]]>
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